Success With a Product-Led Sales Approach

Jessica Ly: I'm here with Michael hoy, who is the Director of Corporate Sales at Pendo.io. Hi, Michael, welcome to the show.

Michael Hoy: Hi, Jessica, thank you very much for having me.

Jessica Ly: Your product is something that a lot of software companies find really beneficial because your product helps the users of that SAS product to adopt faster and has been growing very well. So I am glad you're on the show to talk about corporate sales, how things have been going for you and some of the changes that you've made to actually increase conversion rate, that sales pipeline. So let's start off with, give me a quick explanation of what is Pendo.io does and how things are going for you.

Michael Hoy: Yeah, absolutely. Again, thanks for having me. And you did a great job, giving a very high level of Pendo.io. Essentially, we're here to help people create products that their users love their customers, their users, their prospective customers, as we'll get into here more later today. And primarily how we do that is that we've built a product cloud that includes insights on how people use your application guidance that you can facilitate to your customers inside of your product, as well as mechanisms to collect sentiment and feedback and organize all of this information to prioritize your roadmap based on what's most important to your customers, and how your product should be built. And so you're correct. A lot of great software companies and a lot of great product teams use Pendo.io. And we're helping them scale efficiently. We're helping them create more revenue out of their digital properties. And we're helping them mitigate risk and earn the love and loyalty of their customers that you and I both know to create wonderful customer bases.

Jessica Ly: Michael, you manage a team of essentially more like an inside sales team, right BDR kind of expectations. And during this stay-at-home phase has really changed for you because you're doing it as a remote calling sales more or less. But what changes did you do to increase the conversion? Because I know that a lot of BDRs and inside salespeople do a lot of cold calling, but it's not necessarily the most effective approach.

Michael Hoy: Yeah, that's correct. And you to add on to what you said, we have a little bit of a hybrid team, our sellers hunt and build a lot of their own pipeline. And they also close their own deals. So they're very much full cycle. Whereas before the pandemic, they may have spent some time in the fields, in region, and territory. Now, of course, everything is inside at home. But they are still expected, of course, to build all of their own business to close. And so one of the things that we did this year, and it's a little bit of a coincidence that it aligned with the global events and the change in the market space because we have been planning this for years. But we put our product at the center of our sales motion, part of what we bring to our marketplaces, thought leadership around how to build a product-led organization. And so, this was really our next step in walking the walk. And we've put in mechanisms like a freemium model, where prospective customers can come in and try our product for free. Before talking to a human before engaging in a sales cycle, we've required prospects to trial our product before they buy it. And we've, we've situated it so that the product is the centerpiece of the product drives the value, the humans in our sales cycle, really help justify that value and justify the cost for that value. And what we've seen is a great stat that you and I were talking about earlier today is 74%. We are 74% more likely to win a deal when a brand new customer if they've touched our product, they've been inside of Pendo if they've at least tangibly seeing what sort of value could be presented to their business if they partner with ours.

Jessica Ly: And how do you discover the higher conversion rate and then how did you actually test that out too then scale that change?

Michael Hoy: This has really been a long time in the making for the US trials. Software trials at Pendo.io have been a part of our sales cycle almost since the inception of the business. So I joined Pendo.io. About five years ago, I was an employee number 36. We're entering upon 500 employees now and our original VP of sales, Chaz Guaranteeno CEO, a business called Magnus health here in Raleigh, North Carolina before he joined Pendo.io and getting people into the product was a big part of the sale of Magnus health. And so, when he built the strategy here at Pendo.io, we very much went into the market looking to differentiate from some of our competitors. Because it's a, it's a competitive, crowded space, by proving that our product was best of the best, it's hard just to sit in front of somebody and say, let's say my product is the best. It's much easier if you can get them into the product and help them understand, Pendo.io is going to drive the most value into your business because of everything you're experiencing right now. And so early on, as we were still trying to find our feet as a business, I'm still trying to figure out who to sell to and how the product was relatively at the front of that, and was a competitive differentiator for us and has been still is. Fast forward a few years. We tested a free product about two and a half. Three years ago, we had an NPS sentiment module. Now that sits inside of our core packaging, but we went to market with that as a free product. And for all intents and purposes, it wasn't a very successful test. It did not create. We had a lot of people get in and use it and see the value. But it didn't create a lot of business at to speak, that expanded our total addressable market. So for the last few years, we've been testing and iterating on different types of ways to put the product at the center of our sales cycle. And really, what drove the biggest change here was that we made a conscious decision late last year to start requiring prospects to get into the trial. We built chrome plugins that would allow our sales reps themselves to customize demonstrations on top of our prospects, products. And we built a go-to market package called Pendo.io for startups that specifically lead with getting people into the product, seeing the product through a webinar base system through Guided Self-guided tours. And these sorts of tests proved very successful and led to us validating these hypotheses through a freemium product, which we launched at the beginning of the beginning of this core.

Jessica Ly: Wow, that's a fantastic story. I mean, I can see the appeal of it. And what that means also is that the sales process and the conversion from having interest to actually signing a deal has a lot more to do with the true technology they're getting as supposed to that sales relationship they have with the rep.

Michael Hoy: It's true. Now, humans like to buy from humans. It’s not a completely sale, it's not completely product lead sale. And in my opinion, a great product lead sale finds a happy balance. There are awesome businesses out there that are going completely product LED. And that's a great starting point, in my opinion. But at some point, human interaction is needed for coaching for high-value touchpoints. And really, that's what we are trying to accomplish with our product lead sales model is let us use the product as a way to solidify the value that the prospective business is going to see. Then let us use our human skill or human talent to build out that value and help our prospective customers see the pathway to success. What does the value look like in three years? What does the value look like in five years through this combined effort? I really feel like we will create not just prospects who are not just customers that will come in and understand the value and make an initial purchase, but we'll stay with Pendo.io longer expand their business over the years. I mean, inevitably, we hope that their companies are more successful because of the way they use our product and the visions that they've put behind it. So we feel like that happy medium really creates a more synergistic possibility of a future for our customers.

Jessica Ly: Well, let's talk about your sales talent team then. In that case, what characteristics do you look for when you recruit fruit? And do you see any patterns in the superstar reps? That you would like to replicate?

Michael Hoy: It's a great question. And as a young company, we spent a lot of time trying to figure out Hey, what is that profile? What exactly are we looking for? Out in the hiring market that matches what is a pretty unique approach. And we have a few core pillars that don't change. The first is our sales reps have to be value-driven, have to be value-focused, we're not looking for gunslingers, like people who can run and gun and you sell Pendo.io out of their trunk. These are sales reps who are innately curious about the businesses they are selling into. One of my favorite reps, he's actually he's no longer with the business. He’s moved on to an entrepreneurial pursuit. And that's something else we look for. He once said that that selling for Pendo.io was like my on-the-job MBA, I got to ask all these questions, and I got to learn about everybody's businesses. And that sums up one of the core pillars that we look for, we need sales reps, who are innately curious, and want to understand the inner workings of their prospect’s business, because inevitably, that allows us to tie to the highest initiative possible inside of their business that allows us to build a value proposition that is specific to that business. So we're looking for reps who are focused on understanding and delivering that sort of value. On the other side, you don't have to be a technical person when you join Pendo.io. But you need to be coachable. And you need to have a growth mindset. And that's one of the areas in which you will need to become proficient. Pendo.io can be a technical product that we're not selling specifically to developers. But the product, people as buyers are technical. Every day, they work with technical teams, they work on technical specs. Now their job is technical. To build credibility with our buyers, you personally need to walk the walk as well. So we look for coachable growth mindset people. And that's one of the first places where we try to build knowledge and try to build skill on our sales reps.

Jessica Ly: And now that we are pretty much remote, you find that you're recruiting from other cities that you didn't before have opened up the pool.

Michael Hoy: It has, our mantra as a business, though, has always been that we are an office, we're an office culture. We're an office culture because of the collaboration and the core values that we have that facilitate literal awesome Moses of information inside of the office. Now what working from home has allowed us to do is it's allowed us to hire people outside of our core HQ locations and give them more time to relocate. And it has allowed has given us an opportunity to look in different places outside of London and Raleigh and San Francisco in New York, in which we can hire talent. And so a good example is I just hired who I think will be a great superstar out of Arizona. Now I'm hoping that he's going to be able to relocate before the end of the summer. But with all the uncertainty, who knows if he'll half. But all that being said, right, we have had to iterate and pivot a lot of our onboarding and enablement and the ways in which we facilitate the growth of our reps, just purely based on everyone working from home and the fact that we're hiring some people who are not in the general vicinity anymore.

Jessica Ly: Okay, now that the year is wrapping up, looking next year, what are you excited about for the 2021 year?

Michael Hoy: Yeah, this is going to be an exciting year for our business. We made it through the pandemic in a much stronger position, in my opinion, then when we came into the year. We've had a year of excellent growth, far better, I think, then we would have thought given the circumstances. So we are again putting the pedal to the floor on hiring. We're looking to double our headcount next year. We’re looking to get back on track with the growth goals that we had set a few years back. We are bringing the products into more areas of the sale. We have a fantastic CMO right now. His name's Joe Chernov. And he has a wonderful mind map that says that, you know, all marketing inroads shouldn't lead with an IDR an inbound demo request. In fact, he wants all inroads from marketing to end with somebody inside of the product some way or somehow. So as a revenue leader and as a sales leader, I'm looking forward to cultivating prospects and customers who have already seen value, and expanding on that value and hopefully, building better customers and stronger deals and stronger opportunities. And then your Pendo.io, as a whole is attacking new marketplaces. As a business that is growing like ours, we have a few winning moves that you are looking to put into play in 2021 or grow in 2021. That you'll, for all intents and purposes, I think of a kind of flown under the radar for a little bit. And so this will be a breakout year for us in our business. Seeing that we really do like the position that we're in, leaving the shear.

Jessica Ly: Excellent, wonderful conversation with you, Michael. I appreciate you being on the show to talk about Pendo.io and the world sales and so looking forward to more success and having you on the show next year.

Michael Hoy: Absolutely Jessica, happy to join anytime.